The Affordable Care Act requires insurers and self-funded plans to pay a yearly fee to support health plan clinical research. The patient-centered outcomes research institute (PCORI) fee applies to plan years ending on or after October 1, 2012 and before October 1, 2019. The fee is due by July 31 of the calendar year following the close of the plan year. 2015 PCORI fees must be paid by July 1, 2016.
PCORI fees are reported on Form 720, Quarterly Federal Excise Tax Return, for the second quarter of the year. The fee can be paid electronically or mailed to the IRS with the filing. The fee is tax-deductible as a business expense.
The PCORI fee is based on the number of employees, spouses, and dependents covered by the plan. The Fee is $2.17 per life, for policy and plan years ending on or after October 1, 2015, and before October 1, 2016.
The insurance company will pay the fee for employers with insured plans. An employer with a self-funded plan will be responsible for completing the filing and paying the fee.
Most health plans are subject to the fee. An exception is made for stand-alone dental or vision plans, EAPs, wellness programs, plans for employees outside of the U.S., HSAs, and almost all HRAs and FSAs. Click here for a chart explaining the types of plans that must pay the PCORI fee.